How to check if employer is depositing your TDS with the government


It looks like it is the season for scams. After the Punjab National Bank and Rotomac scams, it is now being reported that the Income Tax Department has unearthed a Rs 3,200 crore scam where 447 companies deducted tax from its employees but did not deposit it with the government and diverted to further their business interests.

Now, you might think that it is no big deal since tax is deducted at source and it is not your headache as to what happens to it after that. But did you know that companies siphoning off tax deducted at source (TDS) money can land you, the employee, in a legal tangle?

This is because if TDS is cut from your salary and is not deposited with the department there will be a mismatch in your Forms 16 and 26AS, which can in turn lead to litigation. The department will send you a demand notice as tax deducted from your salary (reflected in Form 16) will not match with the tax deposited against your PAN (reflected in Form 26AS) in the department records.

But don’t fret, there is a way you can check for any mismatches. Read on to find out how.

When is a company required to file TDS returns?

A company is required to file TDS returns with the tax department on a quarterly basis. The last date of filing TDS returns for the company is one month after the end of the quarter. Therefore, for the quarter ending June 30, 2018, the due date for the company to file its TDS returns is July 31. It should be noted that the due date for the quarter ending 31 March is 31 May. Therefore, the Form 26AS for the last quarter will be updated post May 31.

Chetan Chandak, Head of Tax Research, H&R Block India, says that it is advisable for employees to keep checking Form 26AS during the year to ensure that the TDS deducted from their salary is reflected against their PAN in the tax department’s records.

Usually the information from the TDS returns is updated within two days, but it is advisable to check it after the 10 days of the due date, says Chandak.

Checking for any mismatches

Generated by the income tax department, Form 26AS is an annual tax credit statement of a person subjected to TDS. One can download Form 26AS from the
TRACES website
after logging into their e-filing account on the income tax website. It is a password protected statement (password to open the file is date of the birth of the user) which he would have entered while registering with the e-filing portal. Form 26AS provides details such as name of the deductee, PAN, details of deductor, amount of TDS, the amount of TDS deposited and so on.

An individual also has facility to download the Form 26AS using the Net banking facility of authorised banks. One can check the list of banks

The income tax department has started sending SMSs to taxpayers providing information about the total TDS deposited against their PAN by the employer as well as the cumulative TDS deposited for the financial year. Therefore, make sure that your correct mobile number is updated in the department’s records. You can update your mobile number on the e-filing website of the income tax department under the profile settings.

Things to keep in mind

According to tax experts, it is important that your cross check your Form 26AS with the TDS certificates and Form 16/Form 16A during the year as well as at the time of filing of returns. If there are any discrepancies, you must inform the tax deductor immediately to make sure that necessary steps are taken to rectify the mistake.

As for employees, it is their duty to provide PAN details to their employer. In case of non-availability of PAN, your taxes will be deducted at a higher rate. More importantly, if wrong PAN details are provided, then the TDS deducted from your salary will not be reflected in your Form 26AS which is linked to your PAN.